Randy Lerner as Bad at Investing as He is at Owning the Browns

It looks like Cleveland Browns owner Randy Lerner is as good at investing money as he is in hiring people to run his annually pitiful football team. Lerner is claiming in a lawsuit reported by Forbes that a hedge fund is "hiding" $40 Million dollars of his. Forbes writes:

In filing its lawsuit for declaratory judgment enforcing the fund agreements, Paige Capital claims Lerner is contractually restricted by gate provisions from withdrawing its funds because they represent more than 20% of the Paige Capital funds’ assets under management. Lerner Master Fund has countersued for breach of contract, saying it has the contractual right to withdraw its money from Paige Capital’s two hedge funds. Lerner claims in a court document that it’s the only outside investor in the funds managed by Paige Capital, which has “hidden” Lerner’s money and “steadfastly refused to disclose what they have done with” it.

Paige Capital says they have no intention of handing over the $40 Million according to court documents that Forbes revealed.

“[W]e are fully prepared to litigate this matter to the bitter end because we will continue to manage your money, and collect management and incentive fees, until this matter is resolved many years hence,” Christopher Paige, Paige Capital’s general counsel, defiantly wrote in a March letter, court filings show. “You cannot win because you will spend more litigating than we’re fighting over … we decide the best way to protect the funds, and your opinion is irrelevant.”

Too bad us Cleveland taxpayers cannot be so adamant every time we pay for the stadium that his team plays in with taxpayers money.

Next time Lerner should probably read the fine print and doing a little research into the people he entrusts so much money with before he has to do battle in court. Who knew you could be so stupid and be a billionaire?

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Comments

Eugene, the problem is not with Randy Lerner's investment in the Hedge fund...the problem is the CORRUPT LAWS that protect the Hedge Funds and the controls they have over "ANYONE'S" INVESTMENT including Randy Lerner. During the Bank Bailout issue, the Hedge funds were one of the BoogeyMen. I would also like to add one more thing Lerner is a Billionaire. $40 Million is peanuts to him, but I like the fact that Lerner is going after those Corrupt Hedge Funds. He deserves a pat on the back not someone being critical. Maybe, you should investigate and do a story on the Hedge Fund corruption and corrupt laws that protect them and how many Billions of dollars that Americans lost due to these corrupt laws.
BROWNS:Many people would agree that Randy has made a good decision this past year with cleaning house and hiring Holmgren and company to run the Browns. Of course! You can say what has he done in the prior 10 years. Well, Randy did hire some people who looked good on Paper and who had a lot of upside potential, BUT things did not work out as these people fell below expectations. AT the Time, people thought Butch Davis was a good hire as well as Carmen Policy who was involved with the 49ers, and people like Romeo. Who would have thought that Tim Couch would be such a disappointment as well as others. These people underachieved and did not deliver. Regardless of what happened between 1999 thru 2009 does not matter anymore. We need to be concerned with this year, The Browns are 1-3, but they have been competitive in each game which is a good sign for this year and the future. Holmgren and Co has been a good choice.
CLEVELAND STADIUM:Most Cities over the years have funded the stadiums where their sports team plays, especially in smaller market areas. The stadium creates many jobs which is helpful to the economy of Cleveland. ALSO, there are many things that the city can do with the stadium to generate money. The CAVS have concerts and other things going on. I read that one of the stadiums was going to do something like Skating and some seasonal themes. To open a stadium only for football season is unwise. The City should think up of other ways to use the stadium during the off season to generate money for the city and to create jobs. In Pasadena where they have the Rose Bowl, UCLA plays football there. One to Two weekends a month they have huge swapmeets where thousands of people show up. The same thing happens at the Univ of Hawaii where they have the Pro Bowl...they have swap meets and vendors there during the off season. So, don't go jumping down the throat of the Cleveland taxpayers. It is up to the city to be creative and use these assets to make money.

Who would agree to a seed-fund - with a 3-year lockup (!) - a fund managed by a woman with a crappy track record and little actual portfolio management experience?!? In fact, I am told Michele Paige had another start-up fund crash and burn in the year before she tried to start this one - did they not look into her background? I doubt Lerner managed this investment personally and I'd bet a kickback was involved somewhere.

p.s. What corrupt laws protect hedge funds? That makes no sense. If you're referring to the terms of the investment 9which was the subject of litigation0, then you're mistaken - the terms of the investment are specified in a legal agreement between the fund and the investor (the only "law" that applies is standard contract law).